Detail of an automatic gear shifter in a new, modern car. Modern car interior with close-up of automatic transmission and cockpit background
Less than a week before Christmas, workers at General Motors Canada were angered to learn they’re losing future production of the sporty Camaro to a U.S. plant.
The Detroit-based auto maker announced Wednesday the next generation Chevrolet Camaro will be built in Lansing, Mich., instead of Oshawa.
The exact timing and impact on jobs wasn’t immediately available, a spokesperson for GM Canada said.
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The Canadian Auto Workers union estimated it could mean a loss of 1,000 direct jobs starting in late 2015 unless GM replaces the Camaro with another product.
“General Motors has once again shown a complete and utter disregard for its workers and also Canadians in general, whose tax dollars kept the company out of bankruptcy,” said CAW national president Ken Lewenza.
Canadian politicians were quick to respond to the news, saying they would hold GM to the commitments the car company made in 2009 when the federal and Ontario governments provide a $13.7 billion bailout to the auto industry.
The auto maker’s announcement angered some Oshawa plant workers.
“GM always gives us Christmas presents like this: plants closing, lines being shut down, layoffs,” John Recchia, who works on the Camaro line, said in interview outside the plant Wednesday.
“We’re two days away from holiday and we didn’t hear anything about this till five minutes ago,” said his wife, June, who also works at GM, as she struggled to hold back tears.
GM said the decision to move the Camaro to Lansing Grand River would cut capital costs and improve efficiencies by consolidating production of the rear wheel drive Camaro at a plant that also makes the rear wheel drive Cadillac CTS and ATS.
The announcement is part of a series of changes GM is making in Oshawa, where it employs about 4,000 people on two different lines.
The flexible line, which makes the current Camaro, also makes the Buick Regal. GM recently invested $185 million to support the launch of two new products, the all-new Cadillac XTS and the next-generation Chevrolet Impala.
The launch of the Impala will create a third shift and 900 additional jobs early in 2013, the company also noted.
However, the fate of GM’s consolidated line is unclear beyond June 2014, when production of the current generation Chevrolet Impala and Equinox come to an end.
Federal finance Minister Jim Flaherty said he understood production of the next generation Camaro was being moved for “technical” reasons and that the line in Oshawa will continue to be fully used. “I haven’t heard a word about job losses, I can tell you that,” Flaherty told CTV in an interview.
With the rapid recovery in U.S. auto industry sales since the 2008 recession, industry analyst Dennis DesRosiers predicted the Oshawa plant would soon be running at full capacity.
A spokeswoman for Prime Minister Stephen Harper said the government is “concerned about the implications” of the announcement and will hold GM to its commitments.
Ontario’s Economic Development Minister Brad Duguid also said Wednesday the province would hold GM to its production promises through to 2016.
He said he expects the North American automaker to come up with another product to replace the popular Camaro.
GM Canada said the decision would not adversely affect its commitment to produce 16 per cent of all vehicles for the North American market in Canada until 2016.
Lower U.S. labour rates could be a factor in the Camaro decision, some industry observers said.
Labour rates in Detroit Three plants in Canada are on average $34 an hour, compared to $28 in unionized car plants in the U.S., said Tony Faria, a professor with the University of Windsor.
The move comes a week after Michigan enacted “right to work” legislation, which bans mandatory union membership.
However, union membership is still very high at GM plants in other right-to-work states, said Kristen Dziczek, labour director at the Centre for Automotive Research, in Ann Arbor, Mich.
The CAW said it made concessions in 2006 to win production of the Camaro in Oshawa.
With files from Richard Brennan, Marco Chown Oved and the Star’s wire services.